In the mid-1800s, Pottery Lane, a few minutes’ walk from Holland Park Station, was the gateway to one of London’s most notorious slums. It was dubbed Cut-throat Lane, and the residents were largely pig-keepers and brickmakers who had to negotiate holes in the road that were filled with rubbish and effluent.

However, those grotty decades of Sunday afternoon cockfighting and watching dogs killing rats for fun are long gone. Today, a three-bedroom mews-style terraced house there fetches £2.5 million, while “dirty and dissolute vagabonds” — the words of a 19th-century newspaper reporter — have been replaced by celebrities and the founders of a budding tea empire.

We Are Tea is the idea of Daren Spence, a swarthy 38-year-old former accountant, who will finally draw a salary in 2013 after six years of hard grind and loose leaves.

Speaking in a light Geordie accent that belies his upbringing, Spence sits in a room filled with monkey-picked oolong, very vanilla black and whole chamomile flowers infusion teas. He explains that the business is growing at 15%-20% a month, and will turn over £1.1 million this year.

In six months, We Are Tea has moved from being stocked in 25 Tesco supermarkets to 300 while his former employer, HSBC, is one of dozens of businesses poised to run concessions serving the upmarket brand in its offices. Spence turns on the Simplicitea device, in which gunpowder supreme green tea leaves float in hot water for the couple of minutes it takes to make a perfect cuppa.

“Tea loves to dance!” says Spence with exclamation mark-justifying enthusiasm, and it is certainly more subtly flavoured and refreshing than leaves that are tightly packed in a small bag. Despite the success and Spence’s adoration of those boogying leaves, there have been many grim days, and the business is now very different to the original vision. The concept was born out of difficulty around a decade ago, when Spence’s management consultant wife Suzanne suffered mild pneumonia during a break in Budapest. “It was the spring festival, and it was freezing,” he says. “We had just stayed in the hotel, ordering room service, when we finally ventured out and stumbled across a Moroccan version of a tea room. We both had a Moroccan mint and it cheered us up no end — and with the British, tea is like the panacea of all ills.”

Coffee shops were booming, and Spence thought the market was ripe for a chain that specialised in good tea. He found a tea broker in Kent to source leaves from fields in India and China, which are then packed in Bedford. He secured backing from an individual and used his own money — Spence’s stake is 56% — to set up a tea shop in Paternoster Square, home to the London Stock Exchange.

This was popular, raking in £10,000 a week. A bright colour code helped steer customers to the style of tea and exact brand they desired from an extensive menu, which remains a key part of We Are Tea’s branding.

Within 12 months, the shop had made enough money for equity to open two more, with the aim being to create a chain of 10. But the credit crunch hit and there was little of the extra finance that was needed to complete the plan.

Then Occupy London struck, desperate to close down the Stock Exchange in its attack on the corporate greed that had caused the financial crisis. Not only did it fail to occupy Paternoster Square, instead settling next to St Paul’s Cathedral, but supporters of Occupy also managed to shut an independent tea shop rather than one of the City’s mightiest institutions. “Our weekly take went down to £5000 or £6000,” says Spence, his thick eyebrows narrowing slightly. “They robbed us and our customers. One Friday evening, they smashed a window, causing £3000 of damage, and took a safe with £2500 inside it.”

They also turned the shop into an 1800s version of Pottery Lane, defecating on the doorstep. The teahouse couldn’t survive, and closed early last year. However, the tea itself was so popular that online sales were growing rapidly — the range was largely developed by 2009 — to the extent that several large supermarkets and even hotel chains were desperate to stock their jasmine silver needle white or best-selling English breakfast teas.

“Our biggest decision was taking the tea shop offline — it was horrendous, it was my baby,” he sighs, the smile fading briefly.

“But closing it down was the best thing we did.”

WE ARE TEA

Founded: 2007

Staff: 5

Turnover: £1.1 million

Business idol: “I’ve always had a bit of a fondness for [steel industrialist] Andrew Carnegie, the Scottish bloke who conquered America, but for his philanthropy — it was visionary the way he gave the money away.”